Canarc Closes Two Private Financings Totaling CA$4 Million
October 19, 2006
October 19, 2006 - Vancouver, Canada - Canarc Resource Corp. (CCM: TSX and CRCUF: OTC-BB) announces it has closed on two private placement financings totaling CA$4.05 million, including CA$3.5 million in flow-through financing for the New Polaris gold project in northwestern B.C. and CA$0.5 million in non-flow-through financing for working capital.
These non-brokered private placements were well over-subscribed but the Company elected not to issue any shares in excess of the previously announced amounts at this time.
Canarc issued 4,300,000 flow-through units at CA$0.82 per unit to 21 subscribers, each unit comprised of one flow-through common share and one-half of one share purchase warrant, with each whole share purchase warrant exercisable to acquire one non-flow-through common share at an exercise price of CA$1.25 for one year. Canarc also issued 700,000 non-flow-through units at CA$0.75 per unit to 3 placees, each unit consisting of one common share and one-half of one share purchase warrant, with each whole share purchase warrant exercisable to acquire one common share at an exercise price of CA$0.95 for one year.
On the flow-through financing, the Company paid cash fees totaling CA$208,196 and issued 247,800 broker warrants, each warrant exercisable to purchase one common share at CA$0.82 for a one year period from the date of closing. For greater clarity, the news release announcing the two financings dated September 28, 2006 mistakenly disclosed the exercise price for the broker warrants as having the same terms and conditions as the share purchase warrants in the flow-through private placement, instead of the units; so the correct exercise price for the broker warrants is CA$0.82. For the non-flow-through private placement, Canarc paid a cash fee of CA$5,850. All of the securities issued pursuant to the two financings are subject to a standard four-month hold period expiring February 19, 2007.
The CA$3.5 million proceeds from the flow-through private placement will be used by Canarc to commence a Phase 4 work program as follows:
-
Additional infill drilling of approximately 14 holes totaling 7,000 m,
-
Accelerate engineering, metallurgical and environmental studies for an initial economic assessment of the project, and
-
Mobilize 200 tonnes of fuel, mining equipment and supplies for a major underground dewatering and exploration program to commence in Q4, 2006
In addition to the CA$3.8 million in net proceeds from the two financings, Canarc currently holds approximately CA$2.6 million in cash and marketable securities. The Company is now well funded for the next phase of work on the New Polaris property, as well as holding ample working capital for the evaluation of new acquisitions.
Canarc Resource Corp. is a growth-oriented, gold exploration company listed on the TSX (symbol CCM) and the OTC-BB (symbol CRCUF). The Company’s principal asset is its 100% interest in the New Polaris gold property, British Columbia.
CANARC RESOURCE CORP.
Per:
/s/ Bradford J. Cooke
Bradford J. Cooke
Chairman and C.E.O.
For more information, please contact Gregg Wilson at Toll Free: 1-877-684-9700, tel: (604) 685-9700, fax: (604) 685-9744, email: invest@canarc.net or visit our website, www.canarc.net. The TSX Exchange has neither approved nor disapproved the contents of this news release.
CAUTIONARY DISCLAIMER – FORWARD LOOKING STATEMENTS
Certain statements contained herein regarding the Company and its operations constitute “forward-looking statements” within the meaning of the United States Private Securities Litigation Reform Act of 1995. All statements that are not historical facts, including without limitation statements regarding future estimates, plans, objectives, assumptions or expectations of future performance, are “forward-looking statements”. We caution you that such “forward looking statements” involve known and unknown risks and uncertainties that could cause actual results and future events to differ materially from those anticipated in such statements. Such risks and uncertainties include fluctuations in precious metal prices, unpredictable results of exploration activities, uncertainties inherent in the estimation of mineral reserves and resources, fluctuations in the costs of goods and services, problems associated with exploration and mining operations, changes in legal, social or political conditions in the jurisdictions where the Company operates, lack of appropriate funding and other risk factors, as discussed in the Company’s filings with Canadian and American Securities regulatory agencies. The Company expressly disclaims any obligation to update any forward-looking statements. We seek safe harbour.